Expert advice: give apartments as gifts as gifts will soon rise in price

Gifts, whether it be a small surprise or large material values, is a pleasure for everyone to receive - and it seems that nothing will overshadow the joy experienced at the moment of delivery. It is then that the gifted person usually remembers the legislation, and more specifically, the requirement of the Tax Code to share with the state part of his income.

It's no secret that in the Netherlands, gifts, including from parents, are taxed. This can be either a one-time cash surprise or a periodic one, but the total amount should not exceed € 5.515 per year. Otherwise, you need to file a tax return for the gift.

But there are several “special purpose gifts” that have a higher tax exemption threshold, but which can be used once in a lifetime.

In particular, when you receive money from your parents and use it to buy a house or improve your home, you get tax exemption.

In 2017, the amount of exemption was raised from € 50.000 to € 100.000, and taking into account inflation from 2020, subject to all conditions, this amount is € 103.643.

This increased tax exemption amount was introduced for 5 years (2017-2022) and had the goal of providing housing for young people.

Moreover, in this incentive relaxation of the law, “anyone” was added to the list of donors to parents.

According to the government, the scheme, which allows parents to avoid high taxes when buying a home for their child, is so popular that it has caused house prices to skyrocket.

More often than not, following such statements by government officials, there is a high likelihood of changing or completely repealing this exception. Probably, the initial period until 2022 will be shortened in the near future.

Therefore, we recommend that those who planned to make such a gift to their children, or vice versa, hurry up and not put it on the back burner.

A gift can be made in 2020 or 2021, and the funds received can be used until the end of 2022.

We will help you correctly arrange such a gift, draw up an act of donation and, if necessary, submit a gift declaration to the tax office, advise and prepare the necessary documents for a notary.